FWC sets aside unreasonable prohibition notice

Government bodies, such as WorkSafe, have the right to inspect and issue prohibition and improvement notices to workplaces to ensure that they comply with their legal obligations. A notice may direct a workplace to either improve a work practice or plant, or prohibit the employer from carrying out activities until such time as the offending conduct is rectified.

If a business considers that the notice is too onerous, it can seek a review from the issuing body or apply to the relevant court or a Tribunal for a review.

Case study: Techsnip Oceania Pty Ltd v National Offshore Petroleum Safety and Environmental Management Authority T/A NOPSEMA [2016] FWC 495

Techsnip operates vessels in order to construct platforms with diver capabilities. One vessel is the Wellservicer. NOPSEMA is the government body which regulates health & safety, structural integrity & environmental management of all offshore petroleum facilities.

Techsnip has a legal obligation to ensure that its facilities, work and other activities are, so far as is reasonably practicable, safe and without risk to health and safety.

In its ‘safety case’ for the Wellservicer, Techsnip had 3 rescue options in the event of an emergency.

In December 2015, NOPSEMA issued a Prohibition Notice to Techsnip on the basis that, in the event of an emergency, only 2 out of the 3 rescue options were available. NOPSEMA maintained that if an emergency was to occur, this posed an immediate threat to health or safety.

Techsnip appealed this decision to the Fair Work Commission (FWC).

Techsnip argued that:

• The absence of the third option (recovery) did not involve an immediate threat because the other two options (escorting and towing) remained available
• The vessel itself had 72 hours of life support endurance
• In the event of an emergency, recovery was heavily dependent on favourable sea conditions and therefore could only be used in limited circumstances
• Costs to remove the apparent “immediate threat” were disproportionate
• In light of the above, NOPSEMA’s decision was unreasonable

The FWC had to consider whether there was a risk to health and safety in the event of an emergency.

In revoking the Prohibition Notice, the FWC took into account that:

• The recovery option was only available approximately 10% of the time when favourable sea conditions would be present. Therefore, even if the recovery option was available, there was no guarantee that it would be viable
• The risk of an event requiring evacuation was below 1%, and the risk of an operational failure was assessed as .0024% per day. Therefore “the evidence establishes that the risks of a threat are extremely low”
• The industry guidelines stated that the recovery option “is not considered by the industry as necessary for the safe operation of [the system]. By requiring such a requirement NOPSEMA is requiring a practice in excess of industry standards”

In light of the above, the FWC held that NOPSEMA “did not properly consider the low probability of the risks involved, they placed inappropriate weight on the safety case submitted by Techsnip for the project and they effectively required a practice at variance with industry standards”.

Business considerations when appealing a notice

In appealing a notice, any business should consider:

• The prevailing industry standards
• The risk to health and safety
• The cost of complying
• Any alternatives

HR Legal is experienced in reviewing and setting aside regulatory notices for business. If you have been issued with a notice and have any concerns, contact us to discuss.

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This article was produced by HR Legal. It is intended to provide general information only in summary format on legal issues. It does not constitute legal advice, and should not be relied on as such.